A reader claims his great uncle was sold a credit card by Lloyds despite the
fact that he clearly couldn't afford to use it

I have exhausted all my efforts with Lloyds concerning a credit card that my great uncle was given in a branch. He was 77 years old at the time and on an income of about £130 per week and the card had a limit of £2,000. He did not ask for this card and it was only ever going to cause him trouble as he would never be able to afford the repayments.

He approached me in 2007 to say that he was getting into difficulty making repayments and I arranged for him to pay £10 a week, which he did meticulously.

I’m astonished at the amount of interest that has been charged to the account. This aspect has only been brought to my attention in the last year, when I became responsible for his finances during a 13-week stay in hospital.

Lloyds has been unable to provide us with an original application form yet tells us that the correct checks were done. I feel that the card was given to him in order to meet a target.

Your great uncle, William Pritchard, does not own a property and this debt had become something of a millstone around his neck. Yet he was determined to pay it off and actually did so in the middle of this year.

In 2004 a repayment plan had been set up with a freeze on interest. In 2007 you realised that there were state benefits that your great uncle was entitled to but wasn’t claiming. He had lost a lung through contracting Tuberculosis in the Second World War and had been severely disabled since.

The allowances you arranged enabled him to pay more towards the debt but also meant that interest started to be applied again as the loan was now considered “affordable”.

Once the debt was paid off he asked the bank to refund interest charged from September 2007. It refused, saying: “You should have contacted us back in 2007 when your account began being charged interest.”

It added that refunds could be considered only if a complaint was raised within six years of the problem. “As six years have passed your complaint is time-barred,” Lloyds said.

When I approached Lloyds it pointed out that your great uncle had used the account and that affordability had not become an issue until four years after he had taken it out.

So the bank did not feel that the card had been mis-sold. However, it acknowledged that your great uncle had taken a responsible approach.

Lloyds now says that, while it made no error in applying the interest, your great uncle had not been using the account after he had problems with it. In view of this and the fact that he had done all he could to remedy the situation, it has now refunded all the interest incurred from September 2007.

You say this £1,426 will be used for crucial expenditure now your great uncle has returned from his latest stint in hospital.